Thank you for sharing!

Your article was successfully shared with the contacts you provided.
A former finance executive with Global Crossing sued the company’s chairman and other top officials on Wednesday for defamation and interference with his employment contract. Roy Olofson, whose recent accusations of misleading accounting practices against the troubled telecom firm helped launch a Securities and Exchange Commission investigation, is seeking compensatory and special damages in the suit filed in U.S. District Court in Los Angeles. The defendants include chairman and founder Gary Winnick, chief financial officer Dan Cohrs, executive vice president of finance Joseph Perrone and former vice chairman Thomas Casey. The suit claims Winnick defamed Olofson by publicly calling him “an extortionist” during a meeting this month with about 70 employees. It also alleges that Global Crossing falsely inflated certain financial results and that the company’s external auditor and attorneys had massive conflicts of interest that served to conceal the problem. Global Crossing spokeswoman Janis Burenga denied the claims in a statement. “As we’ve said before, the financial and accounting topics raised by Mr. Olofson have been reviewed by our internal accounting personnel and by Arthur Anderson in connection with the audit of the company’s annual financial statements and its review of the company’s internal financial statements,” the statement said. “Global Crossing believes Mr. Olofson’s allegations are without merit and we have no further comment at this time.” The Bermuda-based company, which maintains executive offices in Beverly Hills, filed for bankruptcy protection on Jan. 28. It is not named in the suit. “While the vagaries of bankruptcy law might prevent a lawsuit against the company, the automatic stay does not protect the individuals,” said Brian Lysaght, one of Olofson’s lawyers. Olofson sent a letter to Global Crossing’s top lawyer in August, asking him to investigate accounting practices. The company said it reviewed the claims about the practices and found them without merit. It said it did not reveal the allegations to its auditor, Arthur Andersen, until just before the company filed for bankruptcy protection. Global Crossing said Olofson threatened to make his allegations public unless he was paid a large amount of money after he was fired in November. Paul Murphy, one of Olofson’s lawyers, said the firm agreed to pay his client $700,000 severance but never delivered on the offer. Copyright 2002 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 1 article* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.